Canadian progress on combatting greenhouse-gas emissions would sway American views on Alberta's oil, U.S. Ambassador to Canada David Jacobson says.

In his State of the Union address on Tuesday night, U.S. President Barack Obama told the Congress that climate-change action is coming, one way or another. He devoted a substantial part of a speech outlining his second-term agenda to pledges to both reduce emissions and beef up U.S. energy security – but he gave no hints of where Canadian oil fits in.

His ambassador in Ottawa, David Jacobson, said that when Canadians can show progress on climate change, it has an impact on Americans' judgment of whether the energy-security benefits of oil-sands imports outweigh the environmental impact.

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"It does," Mr. Jacobson said in an interview on Wednesday. "I think that there are an awful lot of folks who are trying to make up their minds, and trying to draw the right balance between these two things, who I think will be moved by progress.

"There has been progress. As I've said many times before, there needs to be more progress."

The ambassador's comments were made on a day that 48 environmentalists, including the head of the Sierra Club, were arrested in Washington as they protested against TransCanada's proposed Keystone XL pipeline.

Mr. Jacobson took pains to note that he's not drawing a direct link to the proposed pipeline, which would carry Alberta bitumen to Texas, or suggesting that climate-change action will clinch its approval.

But in Ottawa, the Harper government is clearly already making that connection: it has stepped up arguments that Canada is making progress on emissions, and will step up action in lockstep with the United States, as it lobbies for for Mr. Obama to approve the pipeline this spring.

Mr. Harper's government has made a top foreign-policy priority of popping the so-called bitumen bubble – getting Alberta oil beyond glutted markets in Western Canada and the U.S. Midwest, where it fetches lower prices than oil sold in other refining hubs – as well as ensuring the world will accept Canadian oil on its markets one day.

The U.S. President gave no clues in his speech about whether he'll green-light that pipeline. And Mr. Jacobson isn't going to scoop the President.

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But the ambassador's remarks send a message that Canada's action on greenhouse-gas emissions are a factor in the country's trade interests, especially in oil. Where once Ottawa emphasized the energy security the oil sands can offer, it's being told that climate-change action, mitigating the environmental downside, may tip the balance. And that political calculation could spread to other potential markets.

Keystone XL has become a lightning-rod issue for climate-change activists in the United States.

On Wednesday, several prominent environmentalists were arrested for tying themselves to the White House gates to protest against the pipeline – including environmental lawyer Robert F. Kennedy Jr., and Michael Brune, executive director of the Sierra Club, which for the first time in 120 years suspended its policy against civil disobedience because of the Keystone issue.

Their protest has a straightforward message: that the pipeline is a line in the sand for climate change, and Alberta oil must stay in the ground.

But the Obama administration doesn't see it that way – as a straight-line environmental choice between whether Alberta's oil can be burned or not. Mr. Jacobson says the administration sees it as a balancing of economics and security with the environment.

"What we are trying to do is to try to strike the right balance between our energy needs, our need for safe and secure energy, the fact that everyone understands Canada is our safest and most secure foreign supplier of energy – and the environment and climate change," Mr. Jacobson said. "I'm not sure that talking about lines in the sand is the right way to do it."

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Mr. Obama also promised in his State of the Union speech to beef up U.S. energy security by speeding up oil and gas permits, though just how Canadian oil fits in is unclear. The balancing Mr. Jacobson talks about suggests that for Mr. Obama, Keystone's not a "no-brainer" as it was for defeated Republican challenger, Mitt Romney. Mr. Romney talked a lot about "North American" energy security; Mr. Jacobson said the Obama administration takes a "tiered approach" – it would rather get oil from the United States first, but Canada tops the list of outside suppliers.

"If we've got to get oil from someplace, Canada is a safe and secure source of it," Mr. Jacobson said. "Having said that, though, there is a balance that needs to be struck. There is a balance within Canada, and there is a balance between Canada and the United States."

Campbell Clark has been a political writer in The Globe and Mail’s Ottawa bureau since 2000. Before that he worked for The Montreal Gazette and the National Post. He writes about Canadian politics and foreign policy. More

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